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A Manual For Conducting Performance Reviews 


CHAPTER 4
The Process Review


As seen in the last chapter, performance review teams rely on a number of specific analytical techniques. One especially useful technique is the process review, a detailed study of any repetitive series of activities that produce a measurable output. For a manufacturer, a process could be a series of steps leading to the creation of a finished product. In government, some common processes include licensing and permit issuance, voucher processing, budgeting and monitoring or inspecting. A process review is extremely useful in identifying wasteful and inefficient activities. Many such activities were identified by the National Performance Review, such as the infamous "glass ashtray" example cited by Vice President Gore; the specification writing and testing processes required for this mundane item would seem more suitable for the acquisition of jet fighters.

The process review is a particularly valuable tool for analysts studying the performance of their own organizations.

Process reviews allow for improvements not only in what the organization does but how it performs those tasks. Process reviews may require a considerable amount of time, but the results can be well worth the effort. An effective process review crosses artificial departmental boundaries to identify improvements and solutions that individual divisions might not be able to see.

Any organization wishing to review its internal processes can consult numerous books and publications on the subject (see the bibliography). This chapter is not intended to provide an exhaustive "how-to" treatment of the topic, but rather to introduce the topic to the reader and encourage further study.

A process review ideally should use task forces or teams of employees from every critical phase of the work process being studied. In this way, the review furthers a "participative management" approach--those performing an activity participate in its improvement.

Typically, a process review team should have no more than seven or eight participants; larger teams are unwieldy and tend to lose their focus. Agency managers would be well-advised to make the process review assignment an integral part of team members' jobs, and to stress its importance in performance evaluations. This should dispel the common perception that the review is secondary to employees' normal duties--their "real" work.

Agency management should develop review assignments and establish specific problems to be resolved, if known, as well as improvements desired. For example, teams might be instructed to identify and eliminate all unnecessary steps in a process. Management also may set some standards for each activity in the process under review. These standards can have a tremendous bearing on the overall process. For example, if management decrees that a program will have no more than a two-week backlog at any given time, it also sends the message that a backlog of up to two weeks is acceptable. On the other hand, if "zero" backlog is the agency standard, the goal is clear and, as long as the agency falls short of the goal, efforts to improve can continue.

An agency should consider appointing a manager for the process review--one person responsible for the entire program, across all agency divisions. This person might also be held responsible for setting deadlines. The agency may wish to begin by examining its core functions--its most basic and essential functions, or the ones using the biggest share of the agency's resources--and attempt to improve those first.
 


Renaissance
The Comptroller's office maintains its own ongoing series of process reviews intended to improve its own business processes and to find ways to serve its customers better. This project, called Renaissance, is under the direct leadership of the deputy comptroller and is operated by a steering committee composed of employees from throughout the agency. The comptroller and deputy comptroller set out the project's principles and guidelines, while the steering committee designed a program that requires no permanent staff and makes maximum use of existing personnel. After the comprehensive plan for Renaissance was approved by the comptroller, his deputy met with managers, supervisors and various employee groups to seek feedback and support for the plan; in June 1992, the committee identified a group of three agency business processes for the first round of studies and appointed teams to conduct the reviews.

To address team members' needs for skills and motivation, an initial Renaissance training course communicates the program's broad purpose and project specifics. Guest speakers are brought in to cover topics when in-house expertise is not available. Such speakers can be arranged at little or no cost through interagency agreements. Outside speakers have included a professor from the University of Texas' College of Communications (speaking on customer service issues), an organizational development expert (who discusses how organizations change and what characteristics must be present to promote change) and representatives from the private sector. Other elements of the course include team-building exercises conducted by in-house personnel, and an introduction to process review tools and techniques.

One important element of Renaissance is the fact that each process review has a specific time limit. To date, the agency has completed 16 reviews of its various business processes, including purchasing, the open records process, legislative analysis cost estimating, staff education, correspondence, PC/LAN support, hearings and rulemaking--each within a 150-day period. Cost and efficiency savings from these reviews are estimated to continue over the next five years.

Renaissance's biggest undertaking to date is an extensive review of the agency's entire tax system. The review covers numerous processes within the agency and is expected to dramatically reengineer the current tax administration system. This should drastically reduce cycle times and improve both customer service and employee job satisfaction. The Comptroller's office avoided costs of $250,000 in fiscal 1993 by reconsidering a planned consulting contract for planning the tax system's reengineering process. The fact that agency employees can accomplish this very complex task is a testament to the fact that front-line workers can achieve considerable improvements through process review without a significant investment in training or consulting resources.

Because Renaissance itself is also subject to continuous improvement, the steering committee is currently working in subcommittees to refine its team-member application process, its training course and the level and type of communication and support that the committee provides to its teams. Using evaluations completed by former team members and feedback from other agency personnel, the Renaissance project will continue to evolve and reap greater benefits as it matures.

The Renaissance project plan, Renaissance course materials, team-member manual and other materials are available for adaptation and use by other state and local governments. Opportunities also exist for several small agencies to work together in designing their own cooperative programs.
 


Conducting a process review
In the first phase of a process review, the team should document and quantify each step in the process in question, if possible. This can be accomplished with the analytical tools discussed earlier, such as the flow chart. As the process is mapped, note how long various steps take, each step's purpose and its benefits and drawbacks. Identify activities that are duplicated, activities that should be performed but are not, unnecessary activities and any bottleneck situations.

Never forget the threshold question in any process review, which is quite simply: "Is this process necessary?" Many government functions are outmoded or unnecessary, having simply outlived their usefulness. Unless your review addresses this question first, it will simply be modifying a useless process and not genuinely improving government.

In the second phase of the process review, the team identifies the "ideal" method for conducting the process (assuming it is a necessary function.) Steps in this ideal process also should be put into a flow chart, although this is not always easily accomplished; team members may not know what an ideal process should include. In this case, the team needs to consider the characteristics an ideal process would possess. By listing these characteristics, the team will begin to get a picture of the ideal process.

Using the problems or parts of the actual process that are less than ideal, the team can begin to design what is desired. For example, if one point in the actual process acts as a bottleneck, the proper step in the ideal process would promote a smooth and continuous flow of work. If a step in the actual process often takes many days, the analyst might decide that the ideal is same-day turnaround.

TPR found a good example of this problem in a review of a state agency's correspondence process. TPR found that outgoing letters were reviewed by 14 people, and that most of these reviewers had similar tasks, such as checking grammar and form. This excessive amount of review activity kept most correspondence from meeting an agency turnaround-time goal of three days. Needless to say, TPR recommended a streamlined review process with guidelines to ensure that tasks were not duplicated.

In devising the ideal process, study the best similar processes that can be identified. Team members also could study trade or professional journals or other publications to arrive at the characteristics of an ideal process. If time allows, the team should interview staff from other organizations with similar processes, to better understand how other organizations have solved problems or improved the process. Examining someone else's operation may serve to break any rigid mind-set about the operation under review.

Once the team has a clear picture of what the ideal process would entail, it can begin the third phase: comparing the current process to the ideal and noting the gaps by using the benchmarking techniques outlined above. Analysts should examine any obvious gaps between the current process and the ideal process and should try to measure and understand those differences. For instance, state agencies are required to report their surplus property to an electronic system maintained by the Comptroller's office that tracks such assets, so that they can be offered to other agencies or governmental groups. A TPR review of higher education asset management and asset reporting processes found that, due to an exemption in state law, educational institutions did not make such reports. As a result, substantial amounts of surplus property, purchased in part with state tax dollars, were not made available to other agencies and groups that could make use of them. TPR recommended that the exemption be removed and this step added to the higher education institution's process.

The fourth phase is the analysis of the findings. For example, if a similar agency in another state completes a similar process with far fewer approval signatures, the team may want to determine whether they've experienced any unwanted side-effects, such as greater errors or rejections. The team could determine how often its own approval reviews actually uncover a critical error. If the approval process has not proved necessary, it probably can be curtailed or eliminated. Ask questions like: why is the ideal process better? What might improve performance? What should be avoided?

The final phase in a process review is the development of recommendations. The recommendations not only must point out all of the advantages of changing to a new process, but should address the effects of eliminating steps identified as unnecessary. Deflect any potential concerns about the proposed changes by addressing them in the recommendations.

Regardless of the ultimate results, process reviews tend to have one immediate benefit: team participants usually learn more about steps of the process in which they are not involved. When a team member knows why a piece of information is needed within a certain time, he or she is more likely to strive to comply. Similarly, if the team can quantify the actual cost of a process, or its individual steps, they will be more motivated to reduce that cost when possible.


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